Mr. Speaker, I will be dividing my time with my colleague, the member for Sackville—Musquodoboit Valley—Eastern Shore.
I am going to focus this afternoon on two important aspects of the budget, post-secondary education and agriculture. Before I do that I want to say a word or two in general about the budget itself and respond to the criticism from the Canadian Alliance, the C.D. Howe Institute, the Fraser Institute and other right-wing organizations that accused the government that spending was raised too quickly in its budget last month.
Au contraire, we would argue that with the enormous surpluses the government has been running, together with its perpetual ability to grossly underestimate said surpluses year upon year, the budget could have and should have done a whole lot more to make urgently needed social investments. When measured against the share of the overall economy, program funding continues to fall and remains well below where it was a decade ago. Federal spending for example has dropped from 16.5% of gross domestic product to just 11.4% over the past 10 years. This is a reduction that is equal to approximately $40 billion in annual spending.
I will now refer to post-secondary education.
This budget tells us that next year, the CHST will be divided into two separate transfers: a health transfer comprised of 62% of the resources, and another one designed to support post-secondary education and social service with 38% of the resources.
While health spending will increase substantially, funding for post-secondary education will decrease sharply, from $2.4 billion to $1.8 billion.
One must therefore wonder if the new spending for health announced with great fanfare is really new spending, or whether part of this spending comes from a reallocation of funds previously allocated to post-secondary education and social services.
The cutbacks to post-secondary education are unconscionable given what has happened to the levels of student debt and tuition fees in recent years. Average student debt when the government came to power was $13,000. Today it is over $21,000. Tuition fees have exceeded inflation by sixfold between 1991 and 2001.
The government responds by saying that tuition fees are a provincial responsibility, but what it cannot seem to get through its thick head is that it is federal cutbacks that have jacked up tuition fees. It is a cause and effect relationship.
Students and the rest of us realize every day that higher education has never been as important as it is today; new jobs are knowledge based. Yet, it is more difficult than ever to be a full-time student in Canada.
Over the past 20 years, the United States has increased funding for post-secondary education by approximately 20%, while Canada cut back support to colleges and universities by 30%.
For Canadians, this means higher tuition fees and debt loads and fewer students who can afford to attend university on a full time basis simply because they are forced to work part time to help defray their costs. It means crumbling buildings on university campuses because basic maintenance has been deferred due to the cash crunch. It means more reliance on sessional lecturers. It also means larger classrooms. Enrolments are forecast to rise by 30% over the next decade, and the government has to come to grips with that.
Are higher tuition fees keeping some students from attending university? One president told me last week that while the evidence is inconclusive, the data does reveal that children of families in the bottom quartile are not attending post-secondary institutions at the same high rate as those in the top quartile.
A number of solutions are obvious. Reduce costs by entering into genuine partnerships with provinces. Replace the millennium scholarship program with needs based grants. Relieve student debt by having the federal government assume interest costs on Canada student loans during the life of that loan. Eliminate all taxes on scholarships, grants and bursaries. If it is good enough for lottery winners in Canada to escape the tax man, surely it ought to be good enough for our students.
One meaningful solution would be to reduce tuition fees and provide a national system of needs based grants. Anything less is simply tinkering around the margins.
Let me turn briefly to the other subject, agriculture.
Although the government announced increased funding for crop insurance programs, food inspection, veterinary colleges and the Canadian Grain Commission, no new funds will go directly to farmers.
How can this be after the important announcement made by the Prime Minister last June? It is difficult for Canadian farmers to reach a consensus, but the current government has done the impossible.
Farm leaders are unanimous in their opposition to the business risk management proposal of the agricultural policy framework saying they are much worse off under these new proposals than what exists at the present time. It is elementary my dear Watson, the deputy minister, but with 22 major Canadian farm groups saying they have been ignored, the only farmers the department has not alienated are those it has not yet met. This is because the new NISA is nothing more than the old Canadian farm income plan and the government is demanding that more of the money for the new NISA come directly from a farmer's or a producer's NISA account.
In other words, even if some producers are in a better position following the creation of this new risk management program, it will be because they took risks with their own money. If they do not have the necessary funds, too bad for them.
In fact, the current government should increase its financial support for agriculture by $1.1 billion per year, over the next five years. Currently, there is no indexation, and this is totally ridiculous. This money would help farmers forced to compete with the treasuries of Washington and Brussels. This means $1.3 billion annually.
The budget makes passing reference to the problems of international subsidies in agriculture but once again fails to offer any solutions. It could be summed up as “we feel the farmers' pain”. Maybe the government should feel the pulse of farmers instead. If it does not do something and do it significantly and quickly, agriculture and the family farm as we know it will simply not make it.
Based on the Harbinson draft report on a new agricultural agreement at the WTO, it seems likely that in nine or ten years, a new agreement in this area will greatly reduce agricultural subsidies. But the current government carelessly assumes that our farmers will be able to survive another decade of unfair competition by foreign governments.
The government must recognize the damage done to farm families by American and European subsidies and protect the income of farmers.
Ottawa must consult openly with farm organizations, provincial and territorial governments to provide new safety net programs acceptable to the industry. It is time finally to show some grit and determination by challenging the Americans and the Europeans at the WTO.
The U.S. farm bill last year announced an additional $19 billion in farm subsidies which took the Americans to the outer limit, we were told, of what they could spend under the WTO rules. How is it then that they have just announced another package in excess of $3 billion to assist American grain and oilseed producers. The nervous Nellies across the way say we cannot take the U.S. to WTO court because the trade imbalance is so lopsided in Canada's favour.
We witnessed the contretemps that occurred on the split-run magazine issue when the Americans threatened to retaliate on steel. If that is the case then we should not have signed the agreement in the first place. Either we have rules that everybody signs on to and agrees to play by or we walk away from the agreement.
As the Prince Edward Island farmer told the Standing Committee on Agriculture and Agri-Food a year ago, the way it is now under the WTO and the free trade agreement, Americans have rights while Canadians have obligations.